Toyota Motor Corp, the world’s largest automaker, has temporarily suspended operations at all 14 of its assembly plants in Japan due to a malfunction in its production system. This unexpected glitch has brought domestic production to a standstill and is hindering the automaker’s ability to order crucial components for manufacturing. While the cause of the malfunction is still under investigation, a spokesperson from Toyota has stated that it is unlikely to be the result of a cyberattack.
The suspension of operations affects 12 plants initially and was later extended to include the remaining two. This move is estimated to impact approximately one-third of Toyota’s global production capacity, according to calculations by Reuters. The extent of the production loss remains uncertain.
Toyota’s domestic production had been gradually recovering after grappling with semiconductor shortages that led to output cuts. The automaker had witnessed a 29% increase in production during the January-June period, marking the first rise in two years.
The malfunction has had a cascading effect on Toyota’s affiliates as well. Toyota Industries, a group company, reported partial suspensions at two of its engine plants due to the ripple effects caused by the automaker’s production system glitch.
Toyota is renowned for its just-in-time inventory management system, which aims to reduce costs but leaves little room for disruptions in the supply chain. While the exact cause of the recent malfunction is unclear, it comes at a time when Japanese businesses and government offices are experiencing a wave of harassing phone calls, likely originating from China. These calls are believed to be connected to Japan’s decision to release treated radioactive water from the damaged Fukushima nuclear power plant into the Pacific Ocean.
Toyota’s stock price experienced a brief dip in the morning but later rebounded slightly, with shares trading up 0.12% at 2,439 yen in the afternoon. The incident underscores the growing vulnerability of complex supply chains and the reliance of modern industries on seamless technological operations.